Hapag-Lloyd narrows loss 32.6pc while increasing operating profit 156pc
GERMANY's Hapag-Lloyd, the world's sixth biggest container line, narrowed its net loss 32.6 per cent to EUR97.4 million (US$134.3 million) from the EUR128.3 million loss suffered the year before.
At the same time it also posted 156 per cent increase in year-on-year operating profit to EUR67.2 million, drawn on revenues of EUR6.57 billion, down 4.1 per cent.
Earnings before insurance, taxes, depreciation and amortisation (EBITDA) also increased 16.1 per cent year on year to EUR389.1 million.
"Hapag-Lloyd improved its result and transport volume despite persistently tough competition. Thanks to its global liner network with almost 100 services, Hapag-Lloyd was able to take full advantage of growth opportunities in a difficult market," said a company statement.
Said Hapag-Lloyd chairman Michael Behrendt: "Both factors, the improvement in results and the higher transport volume, are clear evidence of the strength of Hapag-Lloyd in the global market."
Transport volume increased 4.6 per cent to 5.5 million TEU across all trades in 2013. But freight rates continued to sag, remaining at $99 per TEU below the previous year's $1,482 per TEU. Revenue declined largely due to a weaker dollar.
"Although Hapag-Lloyd continued to perform well compared to other industry players thanks to the positive operating result, this result nevertheless falls well short of our expectations for 2013 and is ultimately disappointing," said Mr Behrendt.
Said the company statement: "It was no longer possible to push through sustainable rate increases in the market from the second quarter, despite good ship utilisation at times. The important peak season in the third quarter failed to occur again as in the previous year."
Cost-cutting measures paid off and contributed to operating profits. Slightly lower bunker prices of $613/tonne helped. Overall, transport expenses were cut by EUR409 million compared with the previous year by means of savings and energy price effects.
Weaker-than-expected economic growth, particularly in the key BRIC states, had a negative impact on global transport volumes in the past year and thus on the course of business, said the company statement.
"The outlook is much better for the liner shipping sector, especially as the addition of new shipping capacities will decline and an increasing number of older ships will disappear from the market and be scrapped," said Mr Behrendt.